Live on Bloomberg TV

00:00Give us a sense of where you start and figure out how to deal with a situation we've never seen before in the oil business . Well thank you Dave it's great to be back with you. Yes it is an extraordinary situation that we're looking at in the marketplace today. You've saw the numbers from yesterday. I don't think anyone at least in my lifetime has seen anything near that or like that. We're taking very aggressive but appropriate steps to help the industry and help help this economy if you will get through this pandemic. One of the steps that we took initially was to open up the strategic reserve make the storage available to the industry. That's what drove some of the pricing yesterday. You'll note that the folks who were closing out those futures contracts couldn't take possession of the oil because candidly they had no place to put it as a storage is a very acute concern all throughout the industry . We've now contracted to take approximately 23 million barrels of oil put that into the strategic reserve. You also saw the president's tweet that worked closely with Secretary of Treasury Menuhin to see what we might do to look at the laws in the facilities that Congress has directed us to create the lending facilities the main street lending program other types of facilities. There's a Federal Reserve facility as well to ensure that those are available to the energy industry as well . So we're working very closely together to ensure that all of the folks in the producing community have access to those types of loans those that type of liquidity because right now that's what that's another acute concern that we have . So as you go about approaching this very difficult question how do you strike the proper balance between the one hand and how you've said it before the presidency you want to maintain a free enterprise system you don't want the government just controlling these markets. On the other hand you have to save the energy industry. How can you preserve the private sector at the same time that you say that . It was a very difficult balance. We're trying to strike you know the market is ruthlessly efficient at weeding out high cost producers. And in America we honor the free market system . It's what has brought us to where we are today as a country and that is a free and independent nation. So we want to continue that as we move forward. That being said there are market anomalies that happen from time to time and no one could have predicted the impact of this Kovic 19 pandemic that we're all facing. And as we talked about in the past the demand curve has moved so quickly in a downward fashion that it's you know the production is simply not able to keep up with it. It's not able to ramp down as quickly as the demand curve is ramped down. So as a result we're dealing with this oversupply of oil. So our intent is to look at what we can do things like the storage that we just talked about but also with regard to some of the things that you know Congress has generously provided this industry you know taking advantage of for you know perhaps deducting losses that are incurred this year against the last five years of profits. Those are important liquidity tools that we're going to help the industry make it to take advantage of . Mr. Secretary what about curtailing some of the supply that is to say for example banning imports of oil particular from Saudi Arabia. That's something that's been mentioned in the press may not be on your agenda . Sure the president has not taken any of those options off the table. He will continue to evaluate the situation at whatever time is appropriate he'll make those decisions. But he has stated repeatedly and stated again he is he is he will avail himself to any option available to him to help this important industry make it through this pandemic. With regard to the imports of oil it's important to remember that certain refineries in the United States are set up to take specific types of oil. And there is a fundamental difference between you know being dependent upon the import of oil as we were in 1973 and 1974 and simply trading oil which is what you see in the marketplace today. Many refiners choose to import heavy sour crude because that's for them the most efficient most economical way to maintain a profitable status for their businesses. But that's trade. That is not dependent. It's not dependent on the imports .

No schedule data available.

Brouillette Says U.S. Taking 'Aggressive Steps' to Help Oil Companies

U.S. Energy Secretary Dan Brouillette says the U.S. government is taking "aggressive and appropriate steps" to help oil companies during the current glut in supply. He speaks with Bloomberg's David Westin on "Balance of Power." (Source: Bloomberg)

PxPixel